I sold ANR a couple weeks back, but this could be an opportunity to enter again.
ANR has been a friendly stock this year. I’ve squeezed out gains of [12.59%] earlier this year.
Recent news suggest Cleveland-Cliffs has decided to purchase Alpha Natural Resources for 10 billion. The deal has not gone through yet. Cleveland-Cliffs’ shareholders will have to approve the merger. If they do not, Cleveland-Cliffs will owe a $100 million termination fee to Alpha.
"The boards of both Cleveland-based Cleveland-Cliffs and Abingdon, Va.-based Alpha Natural Resources Inc. approved the deal, in which Alpha shareholders will receive 0.95 Cleveland-Cliffs shares ($105.89 based on the stock's Tuesday closing price) and $22.23 in cash for each share held." -BusinessWeek
Currently, Cleveland-Cliffs’ stockholders are unhappy.
I entered at $83.90 and exited $95.47 (just missing the acquisition news by one day). Not discouraged or disappointed because I missed that day (the stock went up towards 120 at one point). There is no way I could have predicted that.
Indicators were pointing to overbought conditions. In this market, I would have been a fool not to secure these gains. Among other reasons include, resistance looming at 100 and my limited available times to trade stocks. These constraints force me to take a more cautious approach to trading. As always, it’s a balance between risk and reward.
ANR's earnings are coming up soon (July 29th' 2008). It could be a good time to enter.
Labels: Featured Stocks, Finances